Delay in Vote on Credit Union Lending Bill

April 30, 2012 at 3:57 pm

The U.S. Senate was supposed to vote on the bill to increase the lending cap for credit unions by the end of April, but the vote has now been delayed.  The Credit Union Small  Business Jobs Bill would increase the amount of lending that credit unions are allowed to do– from the current 12.25 percent of assets to 27.5 percent.

Whatever the reason, banks who oppose the bill seem to think this could signal its end. This is unfortunate when so many small businesses cannot get loans from mainstream banks. According to the Small Business Administration, total outstanding small business loans among the largest banks fell by 1.2% between June and September of 2011, roughly $7.2 billion in just one quarter. It’s even harder for very small and minority-owned businesses, as they are more often denied loans, or are offered less affordable loans than non-minority owned firms.

There is plenty of demand for small business loans. Where banks are receding from lending, credit unions could fill the gap by reaching out to this underserved market.

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Entry filed under: Economic Development, Small Business. Tags: , , .

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